Sales up, losses down for Auxly in 2023

| Sarah Clark

Auxly Cannabis Group Inc. had record net revenues of $101.1 million in 2023 and a net loss of $44.5 million for the year ended December 31, 2023.

The cannabis producer’s newest annual report also shows a net income of $3.9 million compared to a net loss of $66 million in the previous year.

Cost of sales for the company also declined in 2023 compared to the year prior, and fourth-quarter net revenues were $26.9 million, a $2.2 million increase from the same quarter in the previous year.

The company incurred over $50 million in federal excise in 2023, up from $44 million in 2022.

Hugo Alves, CEO, says that 2023 was a pivotal year for Auxly. 

“Thanks to a tremendous team effort, we achieved our profitability targets despite overall industry and macro-economic headwinds. For the first time in our corporate history, we achieved full year adjusted EBITDA profitability; broke one hundred million dollars in net revenue; and generated positive cash flow from operations. We focused and optimized our business, resulting in meaningful cost savings and industry-leading margins, all done while delivering quality products and meeting the ongoing demands of our consumers.”

Net revenues for the year ended December 31, 2023, were $101.1 million compared to $94.5 million during the same period in 2022, an increase of 7%. 

Revenues for 2023 were primarily from sales of dried flower and pre-rolls (61%, up from 42% in 2022), with the rest coming from sales of oils and Cannabis 2.0 products like vapes. Net revenues also included wholesale bulk flower sales of approximately $15.7 million in 2023.

On December 31, 2023, the Company had total cash and cash equivalents of $15,608,000 negative working capital of $40,984,000 and cash flow provided by operating activities of $8,214,000 for the year ended December 31, 2023. 

The company’s financial report also says that it will have “insufficient cash to fund its operations for the next 12 months if the Company’s sales do not improve or if they decline; if the Company’s margins do not improve, or if they decline and/or if the Company’s selling, general and administrative expenses increase.”